NBL Q2 earnings slip into red

National Bank Limited (NBL), the first generation but scam-hit bank, has reported negative earnings in the second quarter of this year. 

Consolidated earnings per share (EPS) for the bank turned negative at Tk 0.36 for April-June of 2022, which was Tk 0.16 in the same period a year earlier, said the bank in a filing with the Dhaka Stock Exchange (DSE) on Monday.

 “Borrowers could not repay installments in time and interest in advance could not be taken to income due to continuous impact of COVID-19 pandemic. Consequently profitability, EPS, net operating cash flow have decreased significantly as compared to previous period,” said the company.

Company Secretary Kaiser Rashid told The Business Post, “Everyone is aware of the causes of the decline in income.”

About the prospect of recovery, he said, “It will take more time for NBL to recover from the current scenario.”

At present, its share was tarded below its face value. On Monday, the bank share remained unchanged at Tk 8.30 on the DSE.

The bank’s Q2 EPS was Tk 0.16 in 2021, Tk 0.05 in 2020, Tk 0.23 in 2019, Tk 0.39 in 2018, and Tk 0.22 in 2017.

Its net operating cash flow per share was Tk 4.79 in negative for January-June 2022 as against Tk 7.80 in the corresponding period a year ago and consolidated net asset value (NAV) per share was Tk 15.49 as on June 30, 2022 and Tk 17.29 as on June 30, 2021.

In May 2021, the Bangladesh Bank barred the NBL from disbursing loans due to the massive irregularities. The bank would not be able to disburse fresh loans before bringing down the advance deposit ratio to 87 per cent, according to the central bank.

Rick Haque Sikder lost his director post at the bank due to his loan defaulter status on September 9, 2021.

In June 2021, Rick Haque Sikder lost the post of NBL directorship for being a loan defaulter. The bank disbursed Tk 600 crore in January-March of 2021 without approval of its board of directors and most of the documents related to these loans can’t be found.

In April 2021, Bangladesh Bank wrote to the NBL seeking the detailed information on the loans disbursed after December 26.  Later, the Bangladesh Financial Intelligence Unit started investigating the irregularities and money laundering against Sikder.

The sponsor-directors hold 28.47 per cent stake in the bank while institutional investors own 26.48 per cent, foreign investors 0.79 per cent and the general public 44.26 per cent as of June 30, according to the DSE.